THE financial and emotional shock waves started by the Rolls-Royce Ltd. bankruptcy two weeks ago are continuing to build in intensity. Last week there was considerable hindsight analysis of just how the calamity had happened —and a string of man-bites-dog oddities. The Guardian bannered a warning to foreigners: BETTER NOT BUY BRITISH. In Parliament, Socialists assailed the Conservative government for shabby treatment of a giant U.S. company, Lockheed Aircraft—a theme echoed on the placards of 1,000 Rolls workers who marched outside in one of the world's rare pro-American demonstrations. On the London Stock Exchange, some investors bought Rolls-Royce shares as souvenirs of bygone industrial glory. Cheap souvenirs, at that: the shares sold for as little as 4¢ each v. 88½¢ before the bankruptcy.
Transatlantic Layoffs. By week's end the Rolls crash had cost the jobs of almost 10,000 workers in two countries, including 6,500 laid off by Lockheed in Burbank and Palmdale, Calif. There, Lockheed had been building the TriStar superjet, for which Rolls was supposed to supply the engines. The bitter joke on both sides of the Atlantic was that the Rolls crash has made the 256-passenger TriStar "the world's largest glider."
Many more Anglo-American layoffs could follow, even though most of Rolls seems likely to survive in one form or another. The profitable auto division will probably be sold by the company's receiver to another firm; at least three British automakers are preparing to bid for it. The government has introduced legislation to nationalize most of the engine divisions. Tory spokesmen, however, have been insisting that a nationalized Rolls will have "no obligation" to keep building RB-211 engines under the Lockheed contract, which proved Rolls' undoing.
If the RB-211 is washed out, it is conceivable—though highly unlikely—that Lockheed would have to cancel the TriStar and follow Rolls into bankruptcy; in that case, the Pentagon would doubtless find some way to keep Lockheed producing C-5A cargo planes and Poseidon missiles. The issues are serious enough to have prompted at least one transatlantic telephone conversation between President Nixon and British Prime Minister Edward Heath.